Exclusive interview with Liz Peace, Head of the BPFFebruary 2011

BSRIA's Head of FM, Jo Harris, meets Liz Peace to discuss the challenges facing the UK property industry and the government's ambitions for creating a low carbon construction industry.

Liz Peace, Chief Executive of the British Property Ferderation (BPF)As Chief Executive of the British Property Federation (BPF), Liz Peace certainly has her work cut out. With such a strong focus on construction sustainability, integration, and innovation, and not least the fiscal policies of the coalition government, the property sector is facing an unprecedented set of challenges. So how, I asked, is the BPF rising to those challenges?

"The Government's approach to sustainability is too diversified," explains Peace. "Everything that Paul Morrell says in the Innovation and Growth Team's report Low Carbon Construction is sensible, but there needs to be a plan, there needs to be a project, and there needs to be coherence. We currently have a lot of departments that don't talk to each other. I would ask: what is the Government going to do to improve coherence?"

"On sustainability, we want to reduce resource consumption. The BPF has always been of the view that you start by reducing demand. When you have reduced the demand as far as you possibly can then you should look at green ways of supplying that energy. To some extent onsite renewables have been leading the industry in the wrong direction. We should have been looking at building an efficient building first, and then find an effective way of supplying the energy."

On the Government's Carbon Reduction Commitment Energy Efficiency scheme (CRC), Liz Peace was critical of a lack of consultation. "The Government didn't even consult the industry before putting out the CRC," she says. "While the BPF does not disagree with the objectives of the CRC, we disagree with the way government have gone about doing it."

The scheme totally ignored some of the fundamental issues with the industry," she adds. "The new government is trying to avoid the same mistakes and be more accommodating on the Green Deal, but they are in a hurry. On the one hand they say we should discuss with the industry how we might design a deal that would apply to commercial buildings, then on the other they say we need a draft legislation out by Christmas."

I asked Liz Peace if she thinks the CRC in particular will drive the improvements the Government are after. "It probably will in part, but I think there is a huge price in terms of complexity and bureaucracy," she says, "[The Government] has devised a scheme of maximum complexity, and I think there are simpler ways to do it. Government has now removed half of the complexity by saying: 'that's alright we just won't pay back any money'. Well that makes it a tax."

Liz Peace is very much behind the introduction of display energy certificates (DECs) for private properties, but has reservations about the way DECs have been applied.
"The way the government chose to implement the Energy Performance of Buildings Directive entirely missed the point," she says. "There is a difference between the energy performance certificate (EPC) as an asset rating and the DEC as an operational rating. It would be far more sensible to have a certificate in the foyer of every building or office displaying how the operational performance compares against a benchmark."

"This is a fundamental issue" she argues. "The industry is asked to deliver a building to perform to a certain standard, but we spend very little time afterwards checking that it performs to the way it has been designed."

When Liz and I talked about BREEAM and LEED standards for encouraging sustainable buildings she explained she would like to see one universal standard. "BREEAM is a British success story," she says. "The industry knows that if you are interested in sustainability you make sure you build a BREEAM Excellent building, but it's a great pity that BRE was privatised. The BRE seems to be driven by commercial imperatives in flogging BREEAM, and there is still room for improvement."

When asked whether low carbon is a driving factor for an organisation embarking on new construction projects, Liz explained that this depends on who is doing what. "The people who embark on new projects are generally the development community who may or may not have an occupier in mind. Frankly, they are more likely to have occupiers in mind these days, as there is very little speculative development."
Moving onto building life cycles, I inquired about her views on whole-life costing and whole-life carbon.

"The building and property industries are very slow in looking at whole-life costing," she admits. "The cost of construction may sound an awful lot, but it pales into insignificance when compared with the cost of operation over just a 10-year period. Embodied carbon is important but you mustn't make it so complicated that you frighten people off trying to measure it."

"My concern is that you will get a sort of analysis paralysis," she adds. "I'm not quite sure where the boundaries are."

I put it to Liz Peace that the Low Carbon Construction report recommends that the property sector embaces green leases. Liz responds by explaining that it is not that easy.

"If you are starting from scratch with a new lease, I think it is perfectly legitimate to ask for a green lease. The problem is that trying to insert green lease ideas into existing leases requires both sides to talk to each other and understand what they want. But it seems remarkably difficult for landlords and tenants to talk to each other, even though that is the best way of improving the performance of a building."

Another recommendation in the Low Carbon Construction report recommends an energy management plan for landlords and buildings. Liz Peace agrees that this would be a great way to improve building performance without changes to lease agreements.

"You may have an existing lease which is too complex and costly to change because you have to bring in lawyers and agents," she explains. "Customer behaviour is definitely a big challenge for the industry. Although you have communication between landlord and tenants, it all comes back to the nature of the tenants."
So what part does Liz Peace see for legislation to drive this move to a more sustainable operation of buildings?

"What you don't want is the sort of legislation that drives a tick-box approach, where we can prove we have done it for the purposes of a regulator or a local trading standards but we haven't really done it. Responsibility must be shouldered by the building management industry."

A lot of it, as Liz explains, is just commonsense. "To run a building the first thing you want is sensible information, then you start to have a look at things like energy consumption. "If you suddenly find a peak in the middle of the night, you might be suspicious," she says.

The BPF have recently participated in the Green Property Alliance report on sustainability metrics, Establishing the Ground Rules for Property: Industry-wide Sustainability Metrics.

"The study looked at a set of common metrics. It is not a reporting framework, it is not trying to challenge all the different reporting frameworks that are out there, it is simply saying that if you are going to measure energy use in buildings here is the sensible way to do it."

The metrics cover energy, carbon, water and waste. I asked which ones Liz Peace regarded as requiring more attention by the industry.

"There is a big debate on how far sustainability reporting should go. I prefer to start with the things that matter by getting the energy, water and waste sorted," she says.

Does Liz Peace think that energy use and carbon dioxide emissions have had a disproportionate amount of attention?

"It doesn't worry me too much because if you get people into the right frame of mind of reporting energy, it is very easy to translate that frame of mind over to water and waste," says Liz Peace. "However, the element of carbon in water and waste mustn't be forgotten."